- SEC probes Elon Musk’s Twitter purchase, alleging non-compliance with a subpoena.
- The $44 billion deal for Twitter, now X, faces scrutiny for potential security law violations.
- Crypto community figures see SEC’s actions as politically motivated.
The billionaire owner of X (formerly Twitter) and the prominent promoter of the meme Dogecoin (DOGE), Elon Musk, has come under investigation by the U.S. Securities and Exchange Commission (SEC).
On Thursday, the U.S. regulator took legal action against Musk, seeking to enforce his testimony regarding his last year’s acquisition of Twitter. Attorneys representing the SEC made these allegations in a legal filing released in the Northern District of California.
According to the SEC, Musk failed to comply with a subpoena requiring his appearance for testimony, initially served to him in May 2023. Specifically, the SEC’s investigation centers around whether any individuals engaged in securities fraud while acquiring Twitter shares.
Notably, in October, Musk completed the acquisition of Twitter, which has since been rebranded as X, with the transaction valued at approximately $44 billion. Emphatically, the point of the SEC’s legal action is to force Elon Musk to testify in its investigation into his Twitter purchase.
Meanwhile, the development has elicited various reactions from prominent figures in the crypto community. Charles Hoskinson, the founder of Cardano (ADA), a digital asset also under SEC scrutiny, left a sarcastic remark. “Totally not political,” Hoskinson commented.
Similarly, John Deaton, founder of CryptoLaw.us and a prominent advocate for XRP in the security case with Ripple, echoed Hoskinson’s sentiment. Deaton argued the U.S. regulator has become a joke in its enforcement actions.
Moreover, the lawyer alleged the SEC engages in enforcement actions in a bid to protect the incumbents of the U.S. political class. “The SEC has become a weapon used to protect the incumbents and the status quo,” Deaton argued.
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